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Negative Price on Natural Gas

“The Permian gas market is flooded with associated gas. Take a deep breath if you trade in Permian gas markets” said Jason Ferguson, RBN Energy LLC analyst. Last week the lowest price on natural gas recorded was negative 25 cents/MMBtu.

Permian basin natural gas production is growing so fast that oil and gas companies are trying to give it away at no charge. In fact, many companies are paying someone else to take the gas out of their storage. Based on the global tendency to implement new regulations against flaring and venting, companies have begun to consider gas-to-liquids (GTL) technology as a feasible way to monetize all produced natural gas.